HST hike at root of plans to prorogue legislature

The work of Premier Wade MacLauchlan’s first year in the legislature will officially close and a new throne speech will be delivered in April a move that has Opposition Leader Jamie Fox worried about a possible HST hike.

The first session of the 65th assembly of the P.E.I. legislature has been ordered for prorogation effective April 1.

Ending a session by prorogation ends all business from that session. All government bills that have not received Royal assent cease to exist.

A new throne speech in April will mark the second throne speech in less than a year. MacLauchlan’s first speech from the throne was delivered last June following the provincial election.

But MacLauchlan says his plan all along was to have a new throne speech in the spring of every year to set the agenda for the year ahead.

“This has been our intention all along to have an annual cycle, a spring and fall sitting with a throne speech to start off the spring sitting,” MacLauchlan said.

“Bringing forward your legislative plan in the spring, you have that time through the Christmas period and winter to work on further policy and legislation… and in some cases if there’s a need for further consideration or to go to committee or to go to some public engagement, then the fall is a good time to do that and bring it into the fall session.”

But Fox questions the timing.

“I’m concerned,” he said.

“This is now the second throne speech in a year. What happened to his plan when he delivered the first throne speech?”He noted the public dialogue about a possible one-point increase to P.E.I.’s Harmonized Sales Tax, spurred by Nova Scotia Premier Stephen McNeil’s call for a united HST rate of 15 per cent across the Atlantic provinces.

New Brunswick has announced it will raise its HST by two percentage points to 15 per cent in July.

The pressure is now on P.E.I. to follow suit.

“Does he have a plan and is the reason why he prorogued have something to do with possibly HST, cuts to jobs and/or programs?” Fox said.

“He says he’s going to balance the budget this year. Based on what the finance minister said last fall that the deficit was $33 million, I would have to wonder what’s coming up in the spring budget and why he needs a new throne speech.”

The provincial portion of the HST is estimated to bring in $254.7 million this year. A one per cent increase would net approximately $25 million in new revenues for the province.

MacLauchlan was heading to Fredericton Tuesday for a meeting of the Atlantic premiers, but he said HST was not on the agenda for discussion.

He would not say whether an HST increase could be included in P.E.I.’s spring budget.

“We will have to consider it and, really, we’re in the process of budget-making consultations and that’s where it lies. We haven’t taken any position on that,” MacLauchlan said.

“I don’t think it’s for me to say yes or no to anything at this stage when the finance minister is out there trying to do his job.”

Finance Minister Allen Roach remained equally tight-lipped about any potential tax increase. He did say the HST has not yet been discussed as part of his budget planning.

“We need to respect the pre-budget process,” Roach said.

Meanwhile, when the prorogation takes effect in April, a hotly debated bill dealing with disclosure of loan write-offs will die on the order paper.

Government closed the house last December without passing the bill after concerns were raised by Conservative MLAs and Green Leader Peter Bevan-Baker the bill was too weak and contained loopholes allowing cabinet the ability to withhold details of loan write offs and debt cancellations from the public if it so chooses.

MacLauchlan says this bill will be brought back to the legislature. When asked if any changes would be made to address the concerns, the premier replied simply, “We’re reviewing that.”

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